KeyBank 2007 Annual Report Download - page 75

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73
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS KEYCORP AND SUBSIDIARIES
Key’s basic and diluted earnings per common share are calculated as follows:
Year ended December 31,
dollars in millions, except per share amounts 2007 2006 2005
EARNINGS
Income from continuing operations before cumulative effect
of accounting change $941 $1,193 $1,090
(Loss) income from discontinued operations, net of taxes (22) (143) 39
Income before cumulative effect of accounting change 919 1,050 1,129
Net income 919 1,055 1,129
WEIGHTED-AVERAGE COMMON SHARES
Weighted-average common shares outstanding (000) 392,013 404,490 408,981
Effect of dilutive common stock options and other stock awards (000) 3,810 5,732 5,033
Weighted-average common shares and potential
common shares outstanding (000) 395,823 410,222 414,014
EARNINGS PER COMMON SHARE
Income from continuing operations before cumulative
effect of accounting change $2.40 $2.95 $2.67
(Loss) income from discontinued operations (.06) (.35) .10
Income before cumulative effect of accounting change 2.35 2.60 2.76
Net income 2.35 2.61 2.76
Income from continuing operations before cumulative effect
of accounting change — assuming dilution 2.38 2.91 2.63
(Loss) income from discontinued operations — assuming dilution (.05) (.35) .09
Income before cumulative effect of accounting change — assuming dilution 2.32 2.56 2.73
Net income — assuming dilution 2.32 2.57 2.73
2. EARNINGS PER COMMON SHARE
During the years ended December 31, 2007, 2006 and 2005, certain
weighted-average options to purchase common shares were outstanding
but not included in the calculation of “net income per common share —
assuming dilution” during any quarter in which their exercise prices were
greater than the average market price of the common shares because
including the options in the calculations would have been antidilutive. The
calculations for the full years shown in the following table were made by
averaging the results of the four quarterly calculations for each year.
Year ended December 31, 2007 2006 2005
Weighted-average options excluded from the calculation
of net income per common share — assuming dilution 10,953,063 384,907 4,548,100
Exercise prices for weighted-average options excluded $27.08 to $50.00 $36.22 to $50.00 $32.84 to $50.00
In addition, during the years ended December 31, 2007, 2006 and
2005, weighted-average contingently issuable performance-based awards
for 1,616,054, 1,700,305 and 966,287 common shares, respectively, were
outstanding, but not included in the calculation of “net income per
common share — assuming dilution.” These awards vest only if Key
achieves certain cumulative three-year financial performance targets and
were not included in the calculation because the time period for the
measurement had not yet expired.